Economic activity grew less than expected in March

2023-05-24 06:50:00

Argentina’s economy barely expanded in march following a monthly rebound in industrial production and construction offset the drag of a record drought and a triple digit inflation.

Economic activity increased by 0,1% compared to the previous month, below the consensus forecast of a 0.4% increase. In the year-on-year comparison, the economy expanded by 1,3%according to government data published on Tuesday.

A record drought in Argentina is lowering forecasts for exports of essential commodities that help drive growth. Consumer spending is also affected, as a inflation above 100% Purchasing power is diminishing. In addition, this year’s presidential elections are influencing production and demand, as economic policy might turn in the opposite direction once more.

Economy 2023: without engines to grow

However, the manufacturing and construction activity it has shown resilience in recent months despite a series of setbacks, which is boosting economic activity for now.

Economists surveyed by the Central Bank of Argentina anticipate that the gross domestic product will contract more than 3% this year, followed by a shallow contraction in 2024.

LM / ED

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